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pinksugarsub -> Optimism's Hidden Dangers (11/15/2007 6:43:23 AM)
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Optimists are generally savers, but extreme optimists make riskier investments and may end up saving less.
The results held across demographic, risk-taking dispositions and health-related issues.
They find that compared with others, optimists:
- Work longer hours
- Invest in individual stocks
- Save more money
- Are more likely to pay their credit card balances on time
- Believe their income will grow over the next five years
- Plan to retire later, or not at all
- Are more likely to remarry if divorced
In comparison, extreme optimists:
- Work significantly fewer hours
- Hold a higher proportion of individual stocks in their portfolios
- Are more likely to be day traders
- Save less money
- Are less likely to pay off their credit card balances on a regular basis
- Are more likely to smoke
“The differences between optimists and extreme optimists are remarkable and suggest that over-optimism, like overconfidence, may in fact lead to behaviors that are unwise,” Puri said.
The researchers liken optimism to red wine.
“Doctors tell us that one or two glasses of red wine a day can be really healthy,” Robinson said, “but no one tells you to drink the whole bottle. It’s the same with optimism. A little bit is really beneficial, but too much can lead to some really bad economic choices.”
http://news.yahoo.com/s/livescience/20071113/sc_livescience/thedownsideofoptimism
pinksugarsub
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